The ValuStrat Price Index (VPI) for Dubai grew 3.8 percent in the second quarter.
During the second quarter of this year sale prices for villas in Dubai showed the best performance since 2014. According to the report issued by the real estate consultancy ValuStrat, the highest annual capital gains were recorded in The Meadows, Arabian Ranches, The Lakes, Jumeirah Islands, Dubai Hills Estate and Mudon.
The ValuStrat Price Index (VPI) for Dubai grew 3.8 percent in Q2 2021 in coparison with the last quarter of the previous year, wiping out nearly all capital losses in 2020.
Accounting for 13 percent of the residential market in Dubai, villas spearheaded the growth and increased by 7 percent quarter-on-quarter and by 6.3 percent year-on-year, the report said.
Apartment sales transactions in the emirate rose by 1.7 percent in the second quarter of the year compared to the previous three months but fell by 4.8 percent compared to the second quarter of 2020, ValuStrat reported. Jumeirah Beach Residence, Palm Jumeirah, Downtown Dubai and The Views demonstrated the best performance.
By contrast, a weaker quarterly performance was recorded in apartment sales values in Jumeirah Village, Dubai Marina, The Greens and Dubai Production City. However, apartments in International City, Palm Jumeirah, Jumeirah Beach Residence, Al Furjan and Al Quoz Fourth showed better performance than in 2020, so the areas managed to write off their capital losses of last year.
The real estate market in UAE slowed in the wake of a three-year oil price decline that began in 2014 and an oversupply of properties. The coronavirus-induced economic slowdown further pressured the market in 2020.
ValuStrat's findings echo a recent report issued by the real estate portal Property Finder revealing that sales of ready villas and townhouses in Dubai jumped more than three times in the first quarter as buyers tended to search for more spacious homes during the coronavirus pandemic.
The consulting company Knight Frank reported last month that a sharp increase in the sales of homes valued at more than USD 10 million was being witnessed in Dubai, the commercial and tourism center of the Middle East. Knight Frank also noted he emirate's return to normal ahead of other cities after a wave of global lockdowns and UAE's rapid vaccination campaign.
Dubai was one of the first cities to reopen its borders to international tourists in July 2020. UAE embarked on one of the world's fastest COVID-19 vaccination drives, stimulating economic activity and the return of overseas visitors.
New initiatives, such as visas for expatriate retirees and the expansion of the 10-year golden visa scheme, are expected to support the local real estate market, analysts say.